Peter, I did read the 10k in great detail as I do for all my investments. Here is the same quote from the 10k:
<< Common Stock
The Company has reserved for future issuance 15,185,167 shares of Common Stock for the exercise of stock options outstanding or available for grant. >>
The difference between the proxy numbers and the 10k numbers is that the 10k has a record date of 12/31/97 and the proxy has a record date of 3/23/98, there were additional options issued between the two dates. I agree that the wording in the 10k is different, saying "outstanding or available for grant", but I also interpret that to mean that these options are an obligation of the company and will eventually show up in the share total. (You might also note in the 10k that they took the opportunity of last Spring's price dip to reprice the options way down)
I am familier with the Treasury Stock Method, FAS 123 and FAS 128. But the bottom line for any investor is what percentage of the company does he own and thus what percentage of the earnings does he own. You could not purchase 100% of CTXS by buying 41 million shares. To purchase the company you would have to buy the 41 million outstanding shares plus buy out the 16 million option shares, thus the ownership of the future earnings is shared by both the outstanding shares and the options which are already issued or the company is obligated to issue.
Also I would ask, if they are not against the 60 million limit, why the rush to authorize 90 million more shares? If I were a shareholder, I would also question giving management the authority to issue the 90 million new shares for any purpose without further shareholder approval. But what do I know, I am just an engineer trading a few odd lots and don't have the training to understand these complicated financials. |
